Mumbai: The Securities and Exchange Board of India (SEBI) has cleared the acquisition of majority stake in Bank of Baroda (BOB) Mutual Fund by Pioneer Global asset Management (Pioneer Investment), an asset management company run by Italian bank UniCredit.
Pioneer Investments, which will be a co-sponsor of the fund, has acquired a majority 51 per cent stake in the BoB asset management company.
The joint venture will be renamed `Baroda Pioneer Asset Management Company Limited', with Pioneer Investments gaining management control and BoB holding 49 per cent in the AMC.
The joint venture hopes to leverage the investment management skills of Pioneer Investments and Bank of Baroda`s nation-wide network of branches.
The board of directors of the AMC will be reconstituted with nominees from Pioneer Investments and Bank of Baroda as well as some independent directors.
The schemes of the mutual fund would, however, continue to be governed by their respective existing offer documents.
Rajan Krishnan, who has been associated with the project from earlier this year, will be the chief executive of the newly formed joint venture. The AMC will now focus on establishing a national sales and distribution network.
With nearly Euro 210 billion of assets under management as of end-May 2008, Pioneer Investments is a global investment management group, offering a wide range of investment solutions, including mutual funds and structured products to clients that include institutions, corporations, intermediaries and private investors.
Pioneer had its operations in India as Kothari Pioneer Mutual Fund and later Pioneer ITI Mutual Fund till mid-2002, before it was bought over by Franklin Templeton Asset Management.
The mutual fund industry in the country has grown by leaps and bounds. Assets under management of Indain mutual funds have surged nearly 70 per cent in 2007 to Rs5,50,000 crore ($127 billion) as of end-December.
BOB Mutual had average monthly assets of about Rs60 crore as of end-June.